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Library of Congress Cataloging-in-Publication Data
Sampler, Jeffrey L.
Bringing strategy back: how strategic shock absorbers make planning relevant in a world of constant change / Jeffrey L. Sampler.
pages cm. – (The Jossey-Bass business & management series)
Includes index.
ISBN 978-1-118-83009-3 (hardback) ISBN 978-1-118-83008-6 (pdf) – ISBN 978-1-118-83007-9 (epub)
1. Strategic planning. 2. Organizational change. I. Title.
HD30.28.S254 2015
658.4'092–dc23
2014024323
The Jossey-Bass Business & Management Series
Foreword
Historically, innovations have originated in rich developed countries in the West and later flowed downhill to the populous developing world. But it is also possible for innovations to originate in poor countries and trickle up to the wealthier world. This is what I've termed reverse innovation.
I initially became interested in reverse innovation during a two-year stint as Professor in Residence and Chief Innovation Consultant at General Electric. At the time, GE CEO Jeff Immelt had put a stake in the ground to grow the company organically by meeting the needs and budgets of customers in heavily populated developing markets. As part of that plan, GE went on to introduce revolutionary new product adaptations – a $1,000 handheld electrocardiogram device and a portable, PC-based ultrasound machine that sells for as little as $15,000 – created to serve rural India and China. By developing lower-cost end-user solutions, GE has been able to cultivate an entirely new market. Just as notably, these innovations have since been adapted and sold in the United States and Europe.
It's clear that if rich nations and established multinationals are to continue to thrive, the current generation of innovators must look beyond their own backyard and consider the needs and opportunities in the vast developing world. And the idea of reverse innovation extends well beyond just product creation. For starters, we see pockets of reverse process innovation springing up as well. Hospitals in India, for example, are transforming health care by performing open-heart surgery for $3,000 rather than the $150,000 we see in the United States – and not simply because of lower labor costs, but also because they have adapted standardized processes from assembly-line manufacturing to make the procedure far more cost effective. This type of innovation would be possible anywhere, but it's more probable in poor countries because it meets their needs and requirements.
